Vivad Se Vishwas Scheme 2020 Explained

Vivad Se Vishwas Scheme has been passed by Parliament to ease the compliance burden on the part of tax-payer. There are 483,000 pending income tax cases before appellate authorities as on 30 November 2019. The disputed tax in these appeals is nearly Rs 9.32 trillion, which is nearly a year’s direct tax collection for the government. The scheme intended for reducing litigation and for settling matters that have been pending for several years. The government expects to resolve 90% of the income tax disputes through this scheme.

Table of Contents

Objectives of Vivad Se Vishwas Scheme 2020

Reduce income tax pending litigation
Generate timely revenues for the Government
Help taxpayers end their tax disputes with the department by paying disputed tax and get waiver from payment of interest and penalty. Also get immunity from prosecution

Features of Scheme

The scheme will be applicable to all appeals/ petitions filed by taxpayers or the income tax department, which were pending until 31 January 2020, with either the Commissioner of Income-tax (Appeals), Income-tax Appellate Tribunal, High Court, or the Supreme Court
The due date to pay the amounts of disputed tax was 31^st March 2020 without any additional payment.
Following the lockdown situation in the country, the scheme has been extended to 30 June 2020 without any additional payment
For payments made from April 1, an additional 10% of the disputed amount was to be paid

Settlement Amount under Vivad Se Vishwas Scheme 2020

Disputed Tax Amount	Amount Payable if Application is filed before 30^th June 2020	Amount Payable if Application is filed after 30^th June 2020
Includes Tax, Interest and Penalty	100% of Disputed Tax	100% of Disputed Tax + 10% of Disputed Tax
Includes Tax, Interest and Penalty determined in search cases by IT department	100% of Disputed Tax + 25% of Disputed Tax	100% of Disputed Tax + 35% of Disputed Tax
Includes Interest and Penalty	25% of Disputed Tax	35% of Disputed Tax